Four biotechs haul in $303M+ from a fresh burst of IPOs

Despite the longest-ever US government shutdown subduing IPO activity in the first-quarter — healthcare IPOs dominated, accounting for 70% of the 20 IPOs in the region, according to accounting firm Ernst & Young. Interest in the sector has far from cooled — with four drug developers focusing on a range of conditions from the ever-popular immuno-oncology to failure-friendly Alzheimer’s — set to make their public debuts on Thursday.

Lieping Chen

In March, Yale spinout NextCure laid out the blueprint for its immuno-oncology research in Nature Medicine, after securing $40 million upfront in an R&D collaboration with Lilly and bringing its cash haul to a cool $180 million. The company — founded in 2015 by Lieping Chen, a noted I/O researcher behind Amplimmune, a company bought out by AstraZeneca five years ago — has now raised $75 million in an IPO. The company, which is poised to trade under the symbol $NXTC, offered 5 million shares at $15 — the midpoint of its range of $14 to $16. The Beltsville, Maryland-based drug developer is focusing on PD-L1-negative tumors to help the scores of patients for whom checkpoint inhibitors don’t work. Its lead experimental drug — NC318 — targets an immunomodulatory receptor called Siglec-15 and is currently being tested in a Phase I/II trial in patients with advanced or metastatic solid tumors.

Steve Dominy

With the field of Alzheimer’s drug development littered with failure and the amyloid-beta hypothesis all but dead, a fresh approach to treating the memory-wasting disease has garnered interest in Cortexyme. The South San Francisco-based biotech is betting that Porphyromonas gingivalis — a bacterial pathogen associated with chronic periodontitis — could be vital to combating Alzheimer’s-related neurodegeneration, based on the findings of UCSF psychiatrist Steve Dominy. Cortexyme’s lead experimental drug is designed to inhibit gingipains — the toxic protease secreted by P. gingivalis — and is being evaluated in Phase II/III study. Backed by Pfizer (14.71%) and Takeda (12.32%), the company has now raised $75 million in an IPO. The company, which is set to trade under the symbol $CRTX, offered 4.4 million shares at $17 — the midpoint of its range of $16 to $18.

With cardiovascular diseases implicated in an estimated third of all deaths, drugmakers (and investors) are always on the hunt for new treatments. Canadian biotech Milestone Pharmaceuticals’ sole asset is a nasal spray formulation of a calcium channel blocker, which has been crafted to treat a rapid heart rate condition that is usually treated with intravenous infusions in the ER. The hope is the rapid-onset drug (currently in late-stage development) can help patients resolve sudden episodes of paroxysmal supraventricular tachycardia — which are often accompanied by palpitations, chest pressure, pain, shortness of breath and fainting — on their own. The drug, etripamil, is also being evaluated for atrial fibrillation and angina. Venture investors collectively claim more than 80% of the company, which raised $82.5 million in an upsized IPO. The drug developer, set to trade as $MIST, offered 5.5 million shares at $15, selling an additional 500,000 shares at the midpoint of the range of $14 to $16.

Bill Hinshaw

About a year after enticing Novartis executive Bill Hinshaw to run its operations, Flagship Pioneering-backed Axcella Health is taking its preclinical pipeline of metabolic modulators — based on science that suggests amino acids can restore health across a network of dysregulated pathways — on to the public market. The company’s lead experimental drug is being developed for hepatic encephalopathy, which are neuropsychiatric abnormalities associated with patients suffering from liver dysfunction, typically chronic liver disease. The Cambridge, Massachusetts-based biotech — set to trade under the symbol $AXLA — raised $71 million by offering 3.6 million shares at $20, the low end of the range of $20 to $22.

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